State's Reaction to Checkoff Resolution Varies

The pork checkoff referendum staged last fall, and the ensuing legal wrangling, set many state groups scrambling for new revenue sources. Between early January and Feb. 28, when the final agreement between USDA and the plaintiffs was signed, most state pork producer groups held their annual meetings. Many addressed a growing concern about funding. Resolutions for revenue-generating options were voted

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The pork checkoff referendum staged last fall, and the ensuing legal wrangling, set many state groups scrambling for new revenue sources.

Between early January and Feb. 28, when the final agreement between USDA and the plaintiffs was signed, most state pork producer groups held their annual meetings. Many addressed a growing concern about funding. Resolutions for revenue-generating options were voted on in most states.

With the mandatory pork checkoff issue temporarily resolved, some states have tabled their plans. National Hog Farmer polled active state associations, and this is what they told us:

Alabama — The Code of Alabama provides for a checkoff, which currently sits dormant because the national checkoff remains intact.

Colorado — Prior to the agreement, a survey of pork producers showed a large percentage were interested in a voluntary investment program.

Illinois — Delegates unanimously approved a new voluntary investment program to address declining non-checkoff revenue while needs increase to address important legislative and policy issues. The new program asks producers to consider a voluntary investment of 5¢/head on market hogs, 3¢/weaner-feeder pig, based on marketings in 2000.

Indiana — A proposal is before the board of directors to restructure the state organization. “Governance and representational issues would be changed to reflect the involvement of all individual pork producers,” reports Terry Fleck, association executive. Programs would fall in either the “services” category (pork conference, state fair promotional efforts) or the “checkoff” category.

A second part of the proposal would spin off all policy and advocacy efforts into a new organization that would address local, state and national policy issues, work on business development and government affairs and handle communications and public relations. Funding would be from membership fees and voluntary checkoff dollars.

Iowa — An existing pork checkoff provision under Chapter 183A of the Iowa Code activates if/when the national checkoff program is terminated. Checkoff rate is 0.25% of gross sale price. Producers may apply for a refund within 30 days after collection. The first purchaser remits the checkoff funds monthly to a newly created Iowa Pork Producers Council, a seven-member board appointed by the state secretary of agriculture. This council will remit 25% of collections to the National Pork Producers Council (NPPC), 15% to the Iowa Pork producers Association, with the balance used for funding projects. The use of the funds is prescribed in Chapter 183A, essentially targeting market development.

Kansas — A membership program has been in place for 8-10 years. Rates are $35/base membership plus 5¢/hog marketed, paid annually. Kansas state executive Mike Jensen says they've taken a low-key approach: “If you are not a ‘traditional’ farrow-to-finish operator, we ask that you just pay what you think is fair.” The funds are treated exclusively as non-checkoff, unrestricted funds with a portion allocated to NPPC and earmarked for national issues. Prior to the “settlement,” producers had approved a 35¢/hog rate.

Minnesota — Delegates voted to pursue a state checkoff in lieu of a national checkoff. With the national program reinstated, the state initiative carries less urgency. “There's no way we would run two checkoffs at the same time,” notes Dave Preisler, state executive. Still, plans are to proceed with collecting the required signatures. The executive committee will then decide whether to pursue the voluntary effort to ensure a program is ready should the national program be eliminated.

Nebraska — No current voluntary investment program exists. Plans are under way to revamp bylaws and to consider new funding sources. A state checkoff bill (LB803), introduced in the legislature in late February, was passed out of committee and on to the legislature floor for debate. On April 10, the association board decided to delay the bill until the 2002 legislative session, giving producers an opportunity to restructure checkoff policies.

North Carolina — Producers contribute to a legislative, pork promotion program, assessed at 4¢/head. Funds are remitted to the state organization monthly, unless they are less than $25; then they are remitted quarterly. Distributions of funds are at the discretion of the board of directors.

Ohio — Pork producers group suspended efforts to implement a state legislative checkoff program when the settlement agreement was reached. Producer feedback is being sought as new objectives for the organization are being set.

Oklahoma — An existing commodity referendum law allows any commodity to petition the commissioner of agriculture to request a referendum vote to create a checkoff program. Legislative approval is not necessary. Contributions are mandatory, although collections are refundable on request. A voluntary program, based on animal units, is being considered with the funds directed toward public policy and industry image issues.

South Dakota — Senate Bill 210 was passed, signed by the governor. A refundable checkoff program would go into effect if the national, mandatory checkoff were terminated. Then, a five-member pork commission would be formed. The prescribed assessment rate, not to exceed 0.45% of market value, is to be imposed on all pigs sold. The bill has provisions for reciprocal agreements in states that also have a pork checkoff, allowing remittance of the fee to the state where the pigs are raised. Refunds could be requested within 90 days after the sale.

Florida, Michigan, Missouri, North Dakota, Tennessee, Texas and Wisconsin have no plans for a voluntary program, although other revenue development options are being considered.